If a friend tells you that he is certain a stock price will rise based on information he heard on television or saw on the Internet, should you be skeptical? Explain
Yes, according to the efficient markets hypothesis stock prices reflect all publicly available information. It is likely that buyers and sellers of the stock have already seen the information, so it is already reflected in the price.
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All of the following are true regarding the Economic Order Quantity model except which one?
A) It determines the cost-minimizing quantity managers should order to keep in inventory. B) It assumes demand is known with certainty. C) It assumes demand is spread evenly over a time period. D) It accounts for changes in interest rates.
Large swings in stock prices are usually caused by
A. A decrease in interest rates. B. An increase in dividend payments by corporations. C. Widespread changes in expectations. D. A decrease in the supply of stocks.